Rate survey: Average card APR falls to 15.18 percent


The average APR on new credit card offers fell to a nine-week low on Wednesday, according to the Weekly Credit Card Rate Report.

The national average APR dropped to 15.18 percent after staying at 15.22 percent – almost a five-year high – for six straight weeks.

Unlike most rate changes, this week’s change was due to a reshuffling of the cards included in the database rather than an APR change.

The Fifth Third Bank Platinum MasterCard was swapped out for the bank’s new Truly Simple card after Fifth Third Bank launched a new credit card line. The Truly Simple card carries a slightly higher minimum APR of 12.24 percent.

Meanwhile, the Costco Anywhere Visa replaced the eBay MasterCard after Synchrony Bank stopped accepting online applications for the eBay card. The Costco card offers a much lower APR of 15.49 percent.

Consumers see credit as easier to get
Credit card applicants and other would-be borrowers are feeling increasingly optimistic about their odds of getting approved for a new loan.

According to research released Oct. 11 by the New York Federal Reserve, more consumers say that credit is now easier to get than it was last year. More consumers also predict lenders will loosen application requirements over the next year and approve a larger share of applicants.

For example, 21.88 percent of respondents polled in September said it was at least somewhat easier to get a loan this year than it was the previous year – up from 19.49 percent in August. Meanwhile, just 31.65 percent said they thought it had become harder to obtain a loan – down from 35 percent the previous month.

Despite signs of growing optimism, many consumers are still relatively pessimistic about the credit market. For example, fewer than 18 percent expect loans to become easier to get over the next year (up from 16.57 percent in August), while just over 31 percent think it will become at least somewhat harder to get approved.

That relative pessimism is persistent: The percentage of consumers who think things are getting worse rather than better has remained larger since 2013. Around half of people currently say that the credit market hasn’t really changed.

People more likely to miss a bill
Consumers have also become more pessimistic in recent months about their ability to stay on top of their bills. According to the New York Federal Reserve, the average probability that a consumer will miss a bill because he or she can’t afford to pay the minimum amount due rose to 14.48 percent in September – up from 11.45 percent in March. Weekly Rate Report
  Avg. APR Last week 6 months ago
National average 15.18% 15.22%
Low interest 12.00%
11.98% 11.96%
Cash back 15.33%
Balance transfer 14.41%
Business 13.12%
Student 13.42%
Airline 15.13%
Reward  15.24%
Instant approval 17.86%
Bad credit 22.86%
Methodology: The national average credit card APR is comprised of 100 of the most popular credit cards in the country, including cards from dozens of leading U.S. issuers and representing every card category listed above. (Introductory, or teaser, rates are not included in the calculation.)
Updated: Oct. 12, 2016

See related: Fed: Card balances grew $5.6 billion in August, Credit card delinquencies rise but remain near historic lows

Published: October 12, 2016

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Updated: 10-21-2016

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